The best university for buy to let locations revealed

The best university for buy to let locations revealed

With growing numbers of property investors looking to the student accommodation sector for its impressive returns, knowing where to invest can be an issue and a new survey may help.

Property website Zoopla says that landlords can enjoy returns of 6.6% when buying a property in a university town.

However, they can only enjoy these impressive returns if they are shrewd over where they invest.

The research shows that landlords in Edinburgh with a four bedroom property can enjoy yields of 6.59% and this is the highest in the UK.

It helps that there is a high demand for quality student accommodation in the city and, for landlords, relatively affordable property prices.

The worst performing areas for landlords

It should come as no surprise that the worst performing areas for landlords wanting to invest in student accommodation are for university towns in the south of England.

The worst performing location is Kingston upon Thames, with a rental yield of 2.81%.

Zoopla's Lawrence Hall, said: "The research offers an interesting analysis for any investor wanting to capitalise on the UK student rental market."

He added that there may also be attractions for parents who want to help their child with the high cost of university to consider buying a student property in a university town.

Mr Hall said: "It comes as no surprise with growth slowing in the south property market that buy to let investors in the north can get the best proportional rental returns."

The Zoopla list of the best buy to let student towns for investment, ranked by gross yield, sees the rankings focus on four bedroom properties.

Following Edinburgh, the second best place for investment is Glasgow, with Stirling, Salford and Belfast in the top five.

The top 10 is also dominated with Scottish universities with Dundee in sixth place, followed by Hamilton, Leeds, Manchester and Aberdeen.

Rental sector 'is in recession'

Meanwhile, the Deposit Protection Service says that the UK's rental sector is, for the first time since the financial crisis, in recession.

The latest figures highlight that in the second quarter of this year, the average monthly rent has fallen for the second consecutive quarter.

It’s the first time this has happened since 2009, with rents falling from £771 per month to £764.

The organisation’s managing director, Julian Foster, said: "After a year of low growth, the rental sector is now in recession in nearly every part of the country. Also, our prediction that rents will decline year-on-year in the second quarter have proven accurate."